Dubai Stocks Climb on U.S. Deal as Israel Holds Gains After Flug

Skyscrapers stand on the city skyline in Abu Dhabi. Abu Dhabi’s index was the only decliner in the Middle East, dropping 0.3 percent at the close after rising as much as 1.6 percent earlier. Photographer: Duncan Chard/Bloomberg

Oct. 20 (Bloomberg) -- Dubai’s stock index rose the most in
more than a month, led by property companies, as investors
returned from a five-day holiday during which the U.S. resolved
its budget standoff. Israeli shares advanced.

The DFM General Index advanced 2.8 percent, the most since
Sept. 15, to 2,909.91 at the close in Dubai. Emaar Properties
PJSC, the stock with the biggest weighting on Dubai’s index,
climbed 3 percent as the company said it planned to announce a
project in Iraq next week. Israel’s TA-25 Index rose 0.7 percent
at the close in Tel Aviv as acting Bank of Israel Governor
Karnit Flug was nominated to become the central bank head.

The Standard & Poor’s 500 Index surged last week as
Republicans and Democrats agreed to raise the U.S. debt ceiling
and reopen the federal government. With the debate about the
budget and debt ceiling probably over for this year, investor
attention will turn to earnings and the Federal Reserve’s
schedule for tapering economic stimulus. Markets in the United
Arab Emirates were closed last week for the Eid holiday.

“This is a bit of catch-up for MENA after global equities
rallied post-U.S. debt deal,” said Julian Bruce, head of
institutional trading at EFG-Hermes U.A.E. Ltd. in Dubai.
“Closer to home there’s been a good deal of positive chatter on
Cityscape and U.A.E. real estate market, and most punters now
fully expect Dubai to secure a win for Expo 2020.”

Property Optimism

Dubai’s measure has climbed 79 percent this year, more than
any of the 50 largest equity markets, as the Persian Gulf
business hub recovers from the credit crisis that led to a crash
in property prices. Economic growth in the emirate is set to
accelerate to 4.6 percent, on average, through 2015 helped by a
rebound in tourism, trade and transport, government estimates
show. That’s more than twice as fast as the prior four years.

The shares are also benefiting from investor demand for
real estate in the emirate’s Citiscape property exhibition
earlier this month and amid expectations the sheikhdom will win
the right to host the World Expo 2020. The winner will be
announced in November.

Emaar climbed to 6.15 dirhams, the strongest close since
Aug. 26. The developer of the world’s tallest tower will
announce details of a project in Erbil Oct. 27. Aldar Properties
PJSC, Abu Dhabi’s biggest developer, surged 5.3 percent, as did
Dubai’s Deyaar Development PJSC.

“We saw some general risk-off activity ahead of the long
break in Emaar,” Bruce said. “I would expect it to be the
beneficiary of some returning cash and probably remains short-term top-pick amongst U.A.E. large caps.”

In Israel, the yield on the nation’s bonds due March 2023
fell four basis points, or 0.04 percentage point, to 3.61
percent, the lowest since May 28. Flug was nominated to become
the central bank governor on a permanent basis, Prime Minister
Netanyahu’s office said today in a text message.